tv The Willis Report FOX Business November 18, 2013 9:00pm-10:01pm EST
>> but things are not stable this adds more uncertainty in every dime counts during the holiday season. neil: we will find out. gerri: hello, everybody. i'm gerri willis. tonight on "the willis report" new record high s. are bulls and bears debate. also, obamacare, the whole health insurance industry in limbo as people fled to get there policies back. and the best way to score a deal . they go to extreme lengths to get your shopping. we are watching out for you tonight on "the willis report." ♪ gerri: welcome to "the willis report". your show, your money, your voice. tonight your retirement.
the dow rocketing past 16,000, setting a new all-time high. although the index did not close above that level, it is still setting its fourth consecutive record close, the seventh this month and the 309th this year. in short, stocks are on fire. does this all feel a little too much like 2000 or 2007? is there a bus coming or a crash ? have we been here before? she is smart invesrs have for the hills? coming together for our expert panel with up-to-the-minute advice. founder of capitalist pig, a portfolio manager and chief investment officer and president and ceo of schaefer asset management. to you first, my friend. is this up bubble just waiting to burst? >> this is nothing like 1999. i remember 1999.
this octuplets were being ." we're not seeing any of that these days. we are seeing is a bull market. persistent. and as indicated by a new all-time high, it remains poise to move higher. gerri: on and on and up and up. what do you say? >> i think that it is a bubble, creating a bubble, the market is gone straight up. we have seen this before. historically not the first time. there are too many examples in history with 1987, 1928, 1890. so many times the government intervened and caused this. gerri: i have been watching individual investors. they finally get wind of this. it put a full 34 billion into equity mutual funds in the last four weeks alone. are they right? where is this market headed? >> in the short run the market
is probably headed higher. we are concerned iermediate because valuations are so stretched. we have been here before, don't think we're in a bubble. the reason why we don't is because her if you look at where we are in terms of stock prices among we were as expensive as we are today from the late 1950's until the early 1970's. we have been here before. gerri: we have been here before, absolutely true. the p/e ratio, 16 beck were looking earnings. less talk about carl icon. the activist investor today. he is very cautious. he thinks this market is way, way, way too expensive. why? thinks that money is cheap and the companies are getting their earnings because money is cheap. what do you say? >> well, he is entitled to his
opinions. market opinions. everyone has one. gerri: what do you make of it? >> i am long stocks. most people make the mistake, they make investing in all or nothing decision. bullish at the top been bearish on the bottom. it continues to be hired. having some equity exposure makes perfect sense. >> if you really understand the movements of the markets, we have never had this type of the market with this type of an interest-rate environment. the formulas being used to create these assessments which everyone is referring to, pe, the ratios. they are all thrown off by the cost of the value of the money, the interest rate which is so that you can't see these models until what is really going on in the economy. this is not even a big issue. gerri: what do you say?
>> well, it's more like a market of stocks. and there are parts of the stock market which are grossly overvalued. but -- gerri: like what? >> twitter end the social media. but there are great parts of the market which are at could valuations. big information technology companies trading at ten, 11 times earnings. that is attractive. you get paid 3 percent valuate. some of the big companies are trading at evaluations. so there is still a decent value in parts of the market. globally we have very attractive gerri: norway, singapore. jonathan wants me to put all y money in subs. i want to invest at home. how do i do that? tell me. go ahead. >> it's pretty simple. the idea is to look below of the
rar screen. not twitter, facebook. but stocks are doing well. i am invested in etf, a ashcake, e.g. p t f. gerri: oh, mlord. >> you cannot say their is a bubble. gerri: i don't even know if they're hurting. >> one of the biggest issues is dead. most people, their accounts, there are not in individual stocks. managers of individual stocks that brought population does not do that. in the index goes up they go up with it. and they go down they go down just as fast. gerri: what do you say? at the end of the day everybody knows that the problem with the market right now is that the federal reserve is pumping money as fast as it can into this economy. are they looking through that? are investors looking through that and now saying, hey, even so, i really like these companies. >> well, i think the reason why people are investing in stocks right now is that there is no other choice in their mind.
traditionally safe investments basically yielding nothing. they're yieldingg nothing by design. first was to save the big banks and then it was to get the animal spirits going. in terms of the speculative juices. and it has worked. some investors have to be careful. there are areas town in this market that are attractive. gerri: i see what you are saying. it is how you choose what you invest in. i want to give you a comment from one of our viewers here says to evaluations due to of flood the markets with more printed money, not with the paper it is printed on. there you have it, very concerned about the impact of the fed on the market. what do you say? >> to what i do, short bonds. go long stocks and sells short bonds. you can do that. those go up when interest rates up. if you want to bet against the fed, don't bet against stocks.
bet against the u.s. bonds that federal reserve policies are not officially -- artificially manipulating hired. gerri: a full disclosure, i am always invested in u.s. stocks. it just depends how much. i want to know. look, there are head winds out there. the s&p is up 23% this year, down almost 20, nasdaq up 28%. i have seen this movie. i am not sure how against. the single biggest threat. >> deflationary, prices deflating. one of the major firms set out a major sell signal. prices start to collapse. the stock market will eventually collapse with that. very dangerous. when they lowered their rates from and a half to 1/4% to make a big deal. gerri: what do you say? >> european stocks have continued to do well. even a lot of those stocks from shaky european countries. up 100 percent of the last year. what you want to look at is the trend itself.
with the down at 16,000 the indication is that the trend remains higher. you will feel differently f-15 five, but as long as talks continue to do well that trend remains pointed. gerri: where is the s&p going? where will it be at the end of 2014? we will come back. >> i will defer to jesse livermore. there are no tops in a bull market. gerri: all right. rounding a south. the voice of reason in this bull and bear debate. what do you say? where are we going and what would be your advice? >> in the short one we are probably goi higher, but the speculative market, people should be sobered by the fact that three-quarters of the increase in the market this year is because investors are willing to pay more for a dollar of earnings. those earnings have nobeen going to beat the market is up 50% from a but earnings are only up 12%.
but earnings have to come on stream. the market will go lower. gerri: you guys were great, just great. thank you for coming on. a great debate. love it. we want to know what you think. what is responsible for the market? the fed earnings were just exuberance? remember that? log on to gerriwillis.c, vote on the right hand side of the screen and i will share the results of the end of the show. of course more to come including figuring out exactly what your deductible copay endo insurance -- what is that really? next, stuck in a state of limbo. health care insurers, the white house and consumers all struggle to figure out what is next for stay with us. ♪
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directly sign up people who qualify for tax credits, bypassing the entire obamacare website. with more of this president of the american action forum. great to have you want. thank you for coming in. i was blown away by this bill be now they will just have the insurers sell the insurance. why didn't we think of that before? >> it is a great moments of iron not only did they finally acknowledged, but they're also, the private sector can probably do as well as thecan which is provide income transfers for those in need. this is not a great day in an administration that has touted government over market solutions again and again and is finding just on the wrong side. gerri: and shocking to me how things continue to blow up even now. of course we had in reaching out who was the cms deputy chief reformation officer saying everything would be okay. here is what he said, committed to fixing the problems so that the experience using the
federally affiliated federal and roman system and crews for the vast majority of consumers by the end of november 2013. are they going to make that date? i have no idea. of course it will improve. it is a very carefully worded statement. it is not working in all. they will make the estimable what they said is our goal, we want to work for 80 percent of americans. well, that is just crazy 99% efficiency out of this. the 1% that can sign up by very special. gerri: of want to play this exactly how carneyaid this so our viewers can hear. listen to this. >> it was never going to be that even with an error free, perfectly functioning website, suddenly every american or potential purchaser of insurance in the marketplace would make that purchase of allied.
gerri: come on. it was never ever ever -- >> well. gerri: what do you think? >> i will say this about the administration. across all policy areas, when they get in trouble the first thing they try to do is set expectations low. working harder and it one more time. they have a big problem with the federal exchanges. there is an instructive experience out in oregon where no one has signed up yet and it is because they tried to have a single website do too much. there is something known as getting the right tool to fix the problem. that is with the private sector does well. the government is not doing well in this instance. gerri: we talked last week about how these insurers are being required to do the impossible. in about six weeks turn everything on its head. reinstate these old policies which they probably cannot do at this point. they will have to change something. the d.c. insurance commissioner gets fired for saying that,
fired for saying the truth. what is going on? >> his firing is a tribute to the political process. the national association of insurance baby and not sure how we can do this bill we did not clear it with the mayor's office . criticize the president. now he is looking for work. gerri: that is ridiculous. as a public official you need to be able to tell the truth, tell the american people the truth which seems to be not a high priority here. >> one of the great lessons of this, especially for younger voters who have not seen the government, the financial market, the private sector to look at the d.c. mayor's office. there is system that does not actually get the tree down to the american people. let's get the president's
management problems. people don't sell in the website does not work. this is not a lesson in how great government is. it is a realism lesson. gerri: i think you're right. and on your realist list, what do you tnk needs to happen? what are you watching for in the next few days and weeks? we will have more congressional hearings. that will go one. in the background there will continue to make changes. what should we be watching for? >> people need to know the rules. i think the most important thing right now is for some clarity to be provided to those who had a policy. maybe they can get it back. what happens to the people who did not have insurance? today only by this stuff on the exchanges or can they get an older policy that is not compliant from an insurer and a lower cost? until that is quite awake it is not obvious to is going to end up where, and the insurance industry is basically ms. we could end up with some very bad policy of comes here, not just political failures and
communications failures. we could get people in that product if we don't fix this fast. gerri: my real fear is that we will be people without coverage, people who had coverage before, they end up having coverage, no way to pay for it. i mean, that is a tragedy. that is not about politics. that is about rlity. >> absolutely. i could not agree more. the most important things, have the financial product called health insurance and allow it to give you access to quality care. we have the insurance problems right now. the next shoe to drop will be the quality of care under obamacare. you know, until we get both of those lined up we have a big policy problem. gerri: a long way to go. thank you for coming on. thank you. later in the show, damage in the midwest from yesterday's storms. many are asking why now. next, we answer the question how you do that with some much confusion surrounding obamacare. it will try to clear up exactly what you're paying for.
just doing a drill down the rest of us is right over our head. what about co pay is it? >> that is what the patient pays windigo to a doctor $20 or $50 a and there is $87 charge the patient may pay $50 up front which is deducted then if there is no :insurance will be paid by the insurance company. >> you may have a planned 20%:insurance that the doctor gets $150 from the insurance company they will pay 80 percent to lead to the patient will pay 20 percent is the patient's responsibility for the insurance amount. that is after the co pay is taken off the top.
gerri: naturally. that is the sharing of costs between the patient and the insurance company. in the past most did not ve coinsurance but we see more of that but depending on the platinum or gold the basic concepts of us sharing of costs the patient takes the bigger share also then you have deductibles. gerri: this is surely confusing because some of the obamacare policies carry big deductibles is. >> up intel two or three years ago they had no deductible they started to increase those several years ago but if you go out of network, the network you will pay $3,000 in the insurance kicks in.
then if you go for a regular checkup that the m&a call -- pay all that but you still pay the $50 co pay. it is confusing and i. gerri: we get those letters from the insurance company it is a laundry list what am i looking at? it says it is not a bill. >> is the explanation of benefits it says that he went to the doctor he charged 350 but we only allow him to participate in3 insurance coanies will pay to buy dollars but you pay $50 and usually just try to explain the breakdown. so my suggestion if you have human-resources go to them to say what does this mean?
you may pay a frontal lot of money before the insurance kicks. >> rules of the drug stake in the networked you understand what you are on the hook for ian clearly you need to know the co pay because you or on the hook right away. >> my doctor was in the plan but because he did a surgical procedure that is out of network. so before you get anything done check with the secretary of might covered? do i need a pre-certification? these are all the things you have to do to limit financial risk the. gerri: great stuff. you did not know you were on the dock for that?
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gerri: it was strange a rare late season tornadoes sweeping across the midwest leaving a path of destruction but why now at the end of november instead of the spring? here with the news we have our meteorologist. good to see you. of. >> what a terrible tragedy. gerri: but shouldn't this be spurring? >> typically that is when bc severe weather outbreaks but what people don't realize is
the fall season typically in november you can see the primary season in the spring then in the fall a secondary season. typically don't see the amount of tornadoes we saw yesterday the latest report is the '80s. just the sheer number and the fact we had to level four confirmed in illinois i don't think that has been confirmed d.c. the e.f. for one to be very rare especially illinois that is a state where sometimes you will see severe weather but by windstorms this time of the season is rare books. >> normally i see a move offshore but here it came to
the east coast from the west what is going on? >> with all the ingredients that you need are ingredients of this spring with low pressure moving in from the rockies and his hair is a classic set up with cold and dry air from canada then temperatures soaring 25 degrees above average then we need that instability to trigger those storms just that when a stream that really got them going as a tornado. gerri: as people were scared to do we expect more of this? >> bill has been a very quiet season up until this point we had about 800 reports all year bad is a tornado dropped actually
that is when you see the most tornadoes is april through july then the secondary sees in so it has been very quiet but also hurricanes. so you have the hell breaks the media is all over it and people get scared but they do happen. gerri: we appreciate you coming on ttalk about it to describe it sets people's minds at ease. we appreciated. looking a fox business., hitting major milestones today the dow crossing 16,000 the s&p but -- as in the fed funds also rose homebuilders confidence holding steady but wells fargo index will have any
reading above 50 as a positive opinion that many homebuilders are worried more drama could stop the recovery in its tracks. said to pay more than $1 billion customers recover their losses the punishment comes from an ethical using customer funds and also facing $100 million civil penalty and this weekend getting your hand on the new police station for selling more than 1 million on friday it expects to sell 5 million by march. those are some other hot stories right now on fox business.. potential in flyers airlines are getting stingy with the reward programs new changes are in the works forcing fliers to get more points for the same benefits. we have mark murphy ceo of
travel alliance media.com. what is going on? door the diving back? >> yes. depending on the airline's. united is limiting the partner airlines with the miles you have to use you have to use more miles to fly partner and delta is using more miles international business and southwest makes it 14 percent more to redeem for the exact same flight. >> fate to this why? >> it is a liability over the years they have change. yearsgo nothing expired now jetblue out the analysis they don't have expiring miles that was a big deal that you don't have to worry about it but if they expire the consumer does not redeem them. gerri: brings to mind the thought should even bother
with a leg work or the hassle? >> the tracking is simple ones who have the number just a book with it put that in your profile than no skin off your back but if you choose a certain airline and then you are probably making a mistake just go for the cheapest ticket for that particular itinerary don't worry about finding a particular airline just get the best amenity and the best price. gerri: if points expire? >> who cares i would rather save $300 then earn frequent flyer miles. those pay off for the businessman who is traveling on somebody else's time who will earn the miles because he flies every week he can use that on a persal vacation.
so that is great to be loyal the loyalty programs the freqnt-flier is good. i like the free upgrades. i will get bumped up to first class to me as a frequent traveler. gerri: that is a benefit. >> you save $1,000 between the first class ticket and the coach ticket to. >> or of the ongoing user's guide free ice-cream? trying to get you into the front door. stay with us.
gerri: important information for the holiday shoppers despite being the most popular president under the christmas tree gift cards are packed with hidden fees. credit-card analyst from bakery.com let's talk about the hidden fees. >> fortunately not as much as they used to be but especially the general purpose give cards with the visa or mastercard or american express they have front end and back end fees. gerri: the purchase speak? >> if you buy a gift card from american express with $50 you will have to put down between four and $7. gerri: i don't like that. and activity dormay fee?
i don't use it and you charge me? >> i have heard so many horror stories about that. , under federal law you cannot use it for 12 months before they start but after that it can be a monthly fee but it is to work $3 of it is only $25 that could add up. gerri: shipping cost? >> sometimes it is free it depends. >> if you order online. gerri: customization and cost? i didn't know you could customize. >> it is becoming creative because it gets a little impersonal maybe upload the image of your family or send the audio message. gerri: how much? >> three or $4 extra.
gerri: any other hidden fees ? >> sometimes they will charge you $15 but that to be more than what you have. but there is a general purpose than brand specific like the amazon or ebay with a specific retailer hardly any fees at all. that is the best bet. gerri: if you use the card are there any other news to share? >> looking for expiration dates looking for a loss for theft protection. gerri: what about discounts online? >> to make sure they have
100% money back guarantee. i have had that happen from personal experience but i was able to get the money back. i called the company. gerri: island my money back this has nothing on it. >> there is a risks to make anything you recommend? >> abc gift cards has been around for awhile, i reject those out. make sure there is the 100% money back guarantee. gerri: good to meet you. coming up my to cents a and fer shopping-- malls are pulling out all the stops. details coming up.
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good to see you. this is the with the desperation this is not nothing free valet and three caribou coffee? >> you know me. i am a tough customer. i am a lot more than three ballet -- free valet the twins, the stroller, and his great retailers get because you want to have a stronger holiday selling season of course, . gerri: the galleria seat at on ice is a big deal. desperate times for desperate men it? >> give me a discount or bounce back or give me something. [laughter] gerri: you prefer not to be entertained instead get a
10% discount. free coach and bag check? that is pretty practical but you have to like that. where are we going with holiday shopping? i heard sales will be down about 2% so the constrain shopping period what do you see now? those of the original expectations. better or worse? >> it is getting worse for the economy but better for the consumer if you are a buyer you will be rewarded for being early and often were if you buy something on ne you have just a special decoder ring or whenever phone you have to see how much more you will get off on the next porches -- purchase.
gerri: i am better off buying now rather than waiting? the markdowns get steeper and steeper the close you get to christmas. >> that they have television thinking it is the only day of the year to go shopping obviously things giving is becoming less important anarchy. the longer you wait the better deals you will see butemember inventories will be a problem with retailers. so if you see it keep an eye on it and stopped it then buy it. gerri: the retailer's pain is your game. i will be back with the answer to the question of the day what is responsible for the market rally? check it out. this is the quicksilver cash back card from capital one.
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gerri: stopped hitting major milestones with the dow jones crossing 16,000 for the first time and the s&p 500 rising past 1500. so what is behind the marketing rally? here's what some of you are hosting the earnings could it possibly be the nod and wink that the fed will pump 85 billionnto wall street? 58% said yes, 21% said no.
log on to a gerriwillis.com every weekday. and this bull run started back in march of 2009. exactly four yea old. that is around the average duration of the bull market since the big crash in 1929. but it is certainly not the longest. looking at the s&p 500, according to industrial research, number five, also following recession and lasting for exactly five years, and it was brought to an end this last monday, october of 1987. number four come in the last bull run started in 2002 and also lasted for five years ended stagnation occurred leading to a
recession, more than six years later in 1981. and 1989, it lasted more than four years, going back some years here. thisun and ended more than eight years later and created the s&p 500. the longest bull run started in 1990 and lasted until 2000. those were the days, my friend. the boom of the '90s was great for stocks. they burst in 2000 and the record long bull run was over. here are some of your e-mails on the stories that we have recently about the government wanting to crack down on rental sites. the government should not have any say, this viewer says come on whether i rent my property. and why should the government needs know if you rent or own. their hands aren't too many pies now and i hope they get burned. and john from new jersey says that i watch your show daily and your efforts confront our crooked politicians and their lack of concern for the working
class is superb. thank you for being the voice of working americans. thank you for that. and today, carl ichan says we could see a big drop. as earnings are being fueled by low borrowing costs and the federal reserve artist that. it's a good point. it can't last forever bullish on stocks always. coldhearted rationality also has to prevail.
i'm tired of being held hostage in the market, this viewer says. that is my "two cents more" and that is it for tonight's "willis report." lou: the white house acknowledging tat they will miss another obamacare deadline, suggesting that this administration is either not good at setting deadlines are not good at meeting him. i am lou dobbs. good evening, everyone come in the white house suggested that health care.gov will not be 100% fixed by the end of this month is the white house had promised. jay carney confirmed a "washington post" report that the administration is now hoping that 80% of users will be able to use the website to enroll in obamacare by the end of the